FROM SHAREHOLDER RIGHTS TO SHAREHOLDER DUTIES – A TRANSFORMATION OF EU CORPORATE GOVERNANCE IN A SUSTAINABLE DIRECTION?

Corporate governance discussions in Europe on shareholders’ rights have increasingly been replaced by discussions on shareholders’ duties. This trend is reflected in company and capital markets law, where shareholders increasingly are imposed duties towards investee companies. For example, the legalization of shareholders’ duties was a key element in the EU Commission’s amendment to the Shareholder Rights Directive in 2017 (Directive 2017/828). A key to this transformation is shareholder accountability, in particular in relation the share ownership of institutional investors. Thus, the transformation bodes a break with an embedded perception according to which the relationship between shareholders and the investee company reflects a private ordering at the center of the European corporate governance model. The increased focus on shareholder accountability emphasizes the societal aspect of share ownership and, more generally, the interest that society holds in public limited liability companies. On the basis of a discussion of the amended Shareholder Rights Directive and the possible implications of this transformation, the paper concludes is that it is questionable whether shareholders can serve as a reliable vehicle for transformation of company law towards a more sustainable framework.